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Shale drillers Whiting Petroleum Corp and Penn Virginia Corporation are rumored to be up for sale while ExxonMobil is bulking up with cash. That means merger mania is about to hit the oil patch.

The rumors are already starting to fly. Just this past week, Bakken Shale focused driller Whiting Petroleum Corp's (NYSE:WLL)stock spiked double-digits after TheWall Street Journal reported that the company was seeking a buyer. That report is on the heels of another Journal report that Eagle Ford Shale driller Penn Virginia Corporation(NASDAQOTH:PVAHQ) was holding an auction to sell itself.

All of this suggests a merger wave clearly appears to be on the horizon. Here's a look at the companies that could be major players as America's oil industry pairs up, looking to emerge from the downturn in oil prices stronger than it entered.

Check, please!One thing has become abundantly clear over the past few months: Too many shale drillers took on too much debt. That debt simply isn't manageable if $50 oil is here to stay for a while.

For example, the management teams of both SandRidge Energy(UNKNOWN:SD.DL) and Halcon Resources(NYSE:HK) both admitted on their fourth-quarter conference calls that they had too much debt for the current oil price. SandRidge's CEO James Bennett said that if $50 oil was the new normal, the company would "probably want to remove $1 billion of debt from the balance sheet," which currently has $3.2 billion in outstanding debt. Meanwhile, Halcon Resources' CEO Floyd Wilson told its investors that at current oil prices, the "appropriate leverage would be at least a third less than we have," which, considering the company's $3.7 billion in debt, that's also more than a billion dollars of extra debt.

These are just two examples of the dozens of overleveraged energy companies that could be seeking a buyer before their debt burdens sink them into bankruptcy should low oil prices stick around for a while. Debt is also a reason Whiting is looking for a buyer, as it assumed $2 billion in debt when it bought highly levered Kodiak Oil & Gas at the top of the oil market last year. Likewise, Penn Virginia had been using a lot of debt to fund its aggressive drilling program, and with that access to capital potentially diminished, it would need a deep-pocketed suitor to help it fund new wells.

Itchy trigger fingersOn the other side of the equation, there are a number of deep-pocketed oil companies that have been waiting for an opportunity to strike. Exxon has already made its intentions known, and it has been rumored to be dreaming big, with some suggesting a takeover of beleaguered BP(NYSE:BP) as not being beyond the realm of possibilities. That said, there's a lot of risk in buying BP because of its legacy issues stemming from the Deepwater Horizon disaster. However, the sky really is the limit for the oil giant, as Exxon has a pristine balance sheet and can basically buy whatever it wants right now.

Meanwhile, top U.S. independents like EOG Resources(NYSE:EOG) and Devon Energy(NYSE:DVN) could bebuyers of smaller shale rivals, or even be targets for the Exxons and Chevrons of the world.

However, EOG Resources would like to keep growing on its own, which it has done by avoiding acquisitions and instead focused on growing organically. On its fourth-quarter conference call, though, the company said it wouldn't mind acquiring drilling acreage at fire sale prices. EOG has the second lowest leverage ratio in its peer group, so it clearly has the capacity to be aggressive in bulking up on its acreage position.

Devon Energy, on the other hand, hasn't been as reluctant to deal, as the company spent $6 billion to buy a prime position in the Eagle Ford Shale last year. Incidentally, its position is located in very close proximity to Penn Virginia's acreage in the play, making Penn Virginia a particularly appealing acquisition opportunity.

Other rumored buyers on the market include former natural gas-focused companies like Chesapeake Energy(NYSE:CHK) and EnCana(NYSE:ECA). Chesapeake has a huge cash position on its balance sheet after it sold some of its natural gas assets at a premium price late last year. The company's CEO said on its most recent conference call that the one area where it would like to bulk up was its oil opportunities, so, any future acquisition would presumably be oil-weighted.

Meanwhile, EnCana actively rearranged its portfolio last year, adding $10 billion in oil-weighted assets. According to its CEO, the company is "very prepared to act if the right opportunity opens up" for another oil-weighted acquisition, with a smaller shale player being right in its wheelhouse.

Investor takeawayIt's quite possible we'll see a number of mergers and acquisitions before the year is over if the oil price doesn't meaningfully recover. Some deals will be forced sales as debt-laden sellers attempt to relieve some of the stress on their balance sheets.

Meanwhile, we could also see a megamerger or two as the strong get stronger in order to thrive no matter what oil prices do in the future. That should make for an good year for energy investors since a consolidation wave could take all boats higher.

Author

Matthew is a Senior Energy and Materials Specialist with The Motley Fool. He graduated from the Liberty University with a degree in Biblical Studies and a Masters of Business Administration. You can follow him on Twitter for the latest news and analysis of the energy and materials industries: Follow @matthewdilallo